BAE Systems has slid into the red after having to pay out £278m in penalties to settle long-running corruption investigations and making writedowns of £973m, mainly due to losing a US army contract.

The company today announced annual losses of £45m after tax, but was bullish about its prospects this year, despite bracing itself for a squeeze in military spending by the US and UK governments.

Chief executive Ian King insisted that BAE was a different company to the one that provoked two corruption investigations into its affairs by the Serious Fraud Office and the US department of justice.

He said that the company was "way ahead" in implementing recommendations made by former Lord Chief Justice Lord Woolf, who was appointed by BAE to review its ethical procedures.

The recommendations follow the ­investigations into "al-Yamamah" – BAE's £43bn deal to sell fighter planes to Saudi Arabia – and smaller armaments deals in Europe and Africa. The Guardian also uncovered evidence of alleged bribes and kickbacks involving BAE.

"We should not mix up the two companies," King told the Guardian, referring to BAE before it had implemented Woolf's recommendation and the company today. Asked if it had damaged relationships with any governments, he replied: "We know where we stand, as do our customers, who have been very supportive. You should not be going around making assumptions."

King also said the company would continue to employ former chairman and chief executive Sir Dick Evans as a paid adviser. Evans, who was the architect of the al-Yamamah deal, provides advice on strategy in Saudi Arabia, which remains an important customer. "He is an adviser to the company," King said. "We are very clear what his terms of reference are."

BAE, the UK's largest manufacturer, made provisions of £973m mainly after losing a $3bn US contract to make military trucks. BAE had originally won the contract last year, but an investigation found there were flaws in the way that the US army handled the process. Excluding the fines and writedowns, pre-tax profits were up almost a fifth to £2.2bn.

BAE said it expected growth this year in three of its four divisions, with the exception of its land and armaments unit, which lost the US truck contract. Shares closed the day up 4.3%. Acknowledging that defence budgets in the UK and US, BAE's largest markets, would continue to be squeezed, the company promised to counter the impact by cost cutting.

Referring to the settlements with the SFO and DoJ in its results announcement, BAE said it "accepts full responsibility for these past shortcomings".

As part of the settlements, BAE said this month it would plead guilty to charges of false accounting and making misleading statements, but it has not admitted any alleged corruption. The ruling in Washington described offshore companies making covert payments linked to the al-Yamamah deal, and payments into a Saudi intermediary's Swiss account. It identified £19m secretly paid to lubricate Czech and Hungarian weapons deals. BAE admitted writing a letter to US authorities in 2000, denying it paid secret commissions.

The agreement does not jeopardise BAE's chances of winning further defence contracts with the Pentagon, and makes corporate prosecution unlikely.